When I asked around for suggested questions for you, Reuters’ James Pethokoukis came up with a good one. He asked what would have happened if we’d done nothing to help the banks in the fall of 2008?

Oh heavens, that’s a tough one because I’m not a specialist in financial matters.

I suspect that some of them would have failed. How far the devastation would have spread and more importantly, whether it would be worse than what we are in right now, is a very interesting question.

If you look at the financial institutions that received the biggest bail-outs, their lending declined very substantially. It did not increase. So the idea that you could simply pour money into the banks and the banks will pour it out into the economy is totally wrong; nor is this a new insight of mine. For a long time people have pointed out that monetary policy is just like pulling on a string. You can pull on a string when there’s too much money out there, but you can’t push on a string. So, you can lead the horse to water, but you can’t make him drink.

Paul Krugman is one of the best known and highest regarded economists on the Left. He says the problem we have right now is the government simply is not spending enough money and the fears we have about the debt causing all these major problems are extremely overblown. What do you say to that argument that is very prevalent on the Left?

Well, it’s a heads I win, tails you lose argument because if we spend twice as much for the next ten years and things don’t get any better – you can still say, “We didn’t spend enough.” We should have spent four times as much. And if we spend four times as much, you can say we should spend 10 times as much. It’s an impossible argument to refute.

It just so happens I’ve been reading a statement by Henry Morgenthau, the Secretary of Treasury under FDR, and he made the statement in 1939 — he said, “We have tried spending money. We are spending more than we have ever spent before and it does not work.” Now this is FDR’s closest confidant, the man who has been in charge of the spending — and after six years of it at this point, they have nothing to show for it and in point of fact, unemployment had gotten back up above 20 percent about a month before he made the statement.

Another economics question: Arthur Laffer (of Laffer Curve fame) has suggested rather plausibly, I think, that the economy this year may actually be better than it otherwise would have been because people believe the Bush tax cuts will expire next year. So they’re pushing economic activity that would have occurred next year into this year to try to get out from the increased tax burden. So in other words, even though the economy is doing poorly, he’s saying we’re actually living off of economic activity that would have otherwise occurred next year. What are your thoughts about that and the prospects for the economy next year?

I hadn’t thought of it before, but it makes perfect sense. A lot of what has happened in this administration has been short term stuff. You can get a special deal on automobiles and that’s wonderful, but that doesn’t mean people will buy more automobiles than they would have otherwise. It means they will buy them during the time of these special deals. And other kinds of short run things put out by the administration have had the same effect, but that’s a one time thing during an election year.

Now your latest book Dismantling America takes a fairly pessimistic view of our future. It’s not doomsaying, but it’s pointing out that, hey, we have some very serious problems that are going to ruin us if we don’t address them. The most interesting way that you sort of discuss this, I thought, and I’d like for you to go into some more detail about it, are the parallels between the United States and the Roman Empire. Could you talk a little bit about that?

Yes, I mean we’re doing the things that destroyed them. We’re in a sense destroying ourselves from within. You’re demoralizing the people, which is not something that shows up on an economic chart at any given time, but when it does show up, it can be fatal.

For example, at one time being a Roman citizen was a source of great pride. Towards the end of the Empire, all sorts of people had been made Roman citizens who had no commitment to Rome and it was just a convenience for them to be able to get the benefits of being a Roman citizen without themselves reciproacting it in any way. And so you had a lot of people with no real commitment to the Empire out there supposedly defending the Empire. You also had something that we have now, that is, at one time the elite of the Roman Empire would lead the Roman legions into battle when the Empire was threatened. And in later times, the elites sat on the sidelines and let other people fight their wars.

One of the painful things I can see now is that most members of Congress have never served in the military, which was not the case, say 20 years ago or in earlier times, and they are more willing to interfere with the military than ever before. They know so little about it — and they’re so willing to cut the military budget without any regard for what this means in terms of our national security.

Also taxation. The Romans raised taxes to the point where people began to abandon certain economic activities. Some farmers decided they’d give up farming and move to the city. Well, that meant there were more mouths to feed in the city and fewer people on the farms to feed them. So there were lots of short sighted things like that.

Now, you talked a lot about cultural issues in the book. That’s something you’ve gotten more into in your columns lately. In the book you wrote about gay marriage and the comparison between gay marriage and interracial marriage. Why do you think that’s a bad comparison and what do you say to the argument that gay Americans have a right, perhaps even a constitutional right to get married?

Well, my Constitution must be out of date because I haven’t seen it there. It’s one of many things, such as the separation of church and state, that I’ve never seen there.

Marriage is not a right. Marriage is an imposition of a government’s interest in certain unions. Probably because those unions produce children, but for other reasons, too. Otherwise people could marry or not marry utterly independently of the government.

But what we’re talking about is not gay marriage. We’re talking about redefining marriage through the convenience of leaders who speak for the gays. And I don’t see any more reason for doing that than for allowing bigamists to redefine marriage to suit their convenience.

Here is a broad question for you which I’m asking because you’ve been around for a long, long time and you’ve seen a lot, you’ve accomplished a lot, and people respect you a lot. If you were comparing the character of Americans today to previous generations, what do you think the differences, both positive and negative, would be?

I’m afraid that the answer that comes immediately is a far greater amount of irresponsibility. I think at one time if you had proposed to Americans that part of their medical expenses ought to be paid for by other people, they would have resented your thinking that’s what they wanted. I don’t think that’s true anymore. I think that one of the big selling points of Obamacare is that somebody else is going to end up picking up the tab for some of your medical expenses. So there’s much more a sense of dependency and less sense of shame.

I’m trying to think of the positive things. Not a lot. Not a lot….

Last question. When I asked around for some questions, columnist David Harsanyi said he’d be fascinated to know whom you read because you’re such an influential guy. Who influences Thomas Sowell?

I think life itself has influenced me more than any given individual.

I mean, after all I was a Marxist when I went to the University of Chicago and I was a Marxist after I took Milton Friedman’s course. So it’s really only when I got to have experience working as an economist in the government that I suddenly began to unravel how government in fact works. So then I could go back and read things that Milton Friedman has said and understand them better now that I had some experience to compare it all to.

I mean there have been a lot of great writers whose things have been very informative, but the actual change of position was really from life experiences. I can think of, you know, books by Banfield — by, oh heavens, Frederick Olmsted, about the antebellum stuff and so forth. In fact I have a whole list of suggested readings on my Web site.

Well, one last question prompted by your last answer. You said you used to be a Marxist and that changed. Talk a little bit about how you moved from Marxism to conservatism.

It occurred during the summer of 1960 when I was an intern of economics in the U.S. Department of Labor. One of the things that concerned me was the question of the effective minimum wages on employment of low income workers. Of course, there are two theories. I was assigned, for example, to study Puerto Rico and so I discovered that after the minimum wage increases, in particular in industries in Puerto Rico, unemployment would increase.

So I said well, how can I test this? Well, the people who were defending them said no, no, employment went down because a series of hurricanes struck Puerto Rico and in those years destroying the sugar cane. So I said what we needed to do then is find out how much sugar cane was standing in the field before the hurricane struck — and I could see the people in the room were dumbfounded.

To me, it was just a question of finding out what the facts were. They obviously were not interested in the facts because the labor department was benefitting from administering the minimum wage law.

And they’re still not.

I realized then you can’t depend on the government because the government is not some brooding presence in the sky. The government is an organization with its own interest which it will serve over and above whatever interest it is supposedly being set up to serve.